Summary List Placement
Davis Polk & Wardwell has become the latest law firm to cut its associates in on the financial success that it has been having in a down economy.
The firm told associates that it has had a busy year and would pay “special bonuses” ranging from $7,500 to $40,000, three sources told Business Insider. The bonuses will be smaller for lawyers on part-time arrangements, but the firm won’t be reducing the standard bonuses that associates will receive at year’s end, the sources said.
“We recognize that activity levels across the firm have been high, and we are grateful for the exceptionally hard work that you put in,” the firm’s leaders said in an email seen by Business Insider.
These bonuses would be in addition to compensation associates are normally eligible for and only applies to those based in the US, where most of Davis Polk’s lawyers are based. The firm has more than 450 US-based associates, according to its website.
Associates who joined the firm in 2019 will be paid an extra $7,500 on Sept. 30; those in the class of 2018 will get an extra $10,000, those in the class of 2017 will get an extra $20,000, those in the class of 2016 will get an extra $27,500, those in the class of 2015 will get an extra $32,500, those in the class of 2014 will get an extra $37,000 and those more senior will be paid a $40,000 bonus, the email said.
Read More: Davis Polk just abandoned its strict seniority-based pay scheme, putting pressure on holdout law firms still using an ‘old school’ lockstep structure to follow suit
The news comes one day after legal industry news site Above The Law reported that Cooley, an international law firm with roots in California, was making its own special bonuses of $2,500 to $7,500, and a couple weeks after Husch Blackwell reportedly moved up bonuses that it had previously planned to pay out in January.
Some firms have made layoffs, some have rolled back compensation cuts that they imposed earlier in the year, some have done neither, and some have done both, even at the same time.
Big Law firm performance has varied widely in recent months as the coronavirus pandemic has roiled the global economy. Firms including Paul Weiss and Milbank have said their performance has been strong, while others anticipate double-digit drops in revenue. Forecasted demand for legal services and revenue have generally improved in recent months at the top law firms in the US, according to Citi, which regularly reports on law firm business.
The news comes less than a week after Davis Polk revealed it would be changing its lockstep partnership compensation system. Such systems award partners according to their seniority, and many firms have changed them in order to attract and retain superstar talent.
Join the conversation about this story »
Source:: Business Insider